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MEG Energy Rejects Husky's Offer; Will Seek Other Buyers
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MEG Energy's Board of Directors has unanimously determined that Husky Energy’s unsolicited bid to acquire MEG significantly undervalues the company.
Husky submitted a ~$3.3 billion-dollar offer for MEG in the beginning of October 2018. This proposal values MEG at an implied total enterprise value of approximately $6.4 billion, including the assumption of approximately $3.1 billion of net debt.
The Husky Offer must remain open until at least January 16, 2019 unless otherwise extended, accelerated or withdrawn in accordance with its terms.
MEG's Special Committee has given its financial advisor, BMO Capital Markets, a mandate to investigate alternative transactions to the Husky Offer.
Mr. Derek Evans, MEG’s Chief Executive Officer, said, “I took over the leadership of MEG because I believe that our assets and technologies set us up for an exciting period of growth and MEG Shareholder value creation. With a substantially improved balance sheet and continued focus on execution and cost control, we expect all future growth to be fully-funded through internal sources, while having significant free cash flow to pay down debt and return money to MEG Shareholders. All of these uses of our capital will drive significant MEG Shareholder value. None of this has been reflected in the Husky Offer which is widely acknowledged in the press and research community to be opportunistic. We urge MEG Shareholders to reject the Husky Offer.”
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